OnDeck (NYSE: ONDK), a small business online lending platform, announced on Thursday its 2019 first quarter financial results. According to OnDeck, net income of $5.9 million, Adjusted Net Income of $8.3 million and gross revenue of $110.2 million.
“Net income was $5.9 million, or $0.07 per diluted share, and decreased from the prior quarter’s net income of $14.0 million, 0.18 per diluted share, primarily due to higher loan loss provision, higher operating expenses and an accrual for income taxes. Net income significantly improved from a loss of $1.9 million, or $0.03 per diluted share, in the year-ago period reflecting higher interest income from asset growth.”
OnDeck also revealed that Adjusted Net Income was $8.3 million, or $0.10 per diluted share, and decreased from $15.9 million, or $0.20 per diluted share, in the prior quarter and increased from $6.4 million, or $0.08 per diluted share, in the year-ago period, reflecting the aforementioned drivers. Meanwhile, Loans grew 3% sequentially and 19% from a year ago to $1.2 billion. Originations were $636 million, down from $658 million in the fourth quarter and up 8% from $591 million in the year-ago quarter.
“The annual growth was broad-based with increases from both domestic and international operations as well as in both term loan and line of credit offerings. The average term loan size was unchanged sequentially at $53 thousand and was down from $58 thousand a year ago. Unit volume decreased 5% sequentially and increased 15% from the year-ago quarter.”
OnDeck then explained that gross revenue was $110.2 million, essentially unchanged from the prior quarter, and up 22% from the year-ago quarter driven by higher interest income. Loan Yield of 35.6% decreased from 36.6% in the prior quarter reflecting a decline in portfolio performance while pricing was generally stable, and was unchanged from the year-ago quarter.
Additionally, OnDeck updated its financial guidance for full-year 2019 as follows:
- Gross revenue of $435 million to $455 million,
- Net income of $20 million to $30 million, and
- Adjusted Net Income of $30 million to $40 million.
The full-year 2019 financial guidance assumes the following trends relative to full-year 2018:
- High single-digit percentage growth in Loans,
- A stable Net Interest Margin,
- A slight increase in the Adjusted Efficiency Ratio,
- A Provision Rate near the midpoint of our 6-7% target range, and
- An effective tax rate of approximately 24%.